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[2016] FCA 748
Federal Court of Australia
2016-06-24
Barker J
Original judgment source is linked above.
BARKER J: 1 The question the subject of this judgment is whether the applicants - the Stevens - should be granted leave pursuant to s 169-1 and s 169-5 of the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (Cth) (CATSI Act) to continue this proceeding, WAD 1 of 2015, on behalf of the Wintawari Guruma Aboriginal Corporation RNTBC against the respondents, Mr Glen Camille and Mr Kenzie Smith. 2 The background to the issue now raised may be found in the Court's recent judgment concerning the expulsion of the Stevens from the Aboriginal Corporation. See Stevens v Wintawari Guruma Aboriginal Corporation RNTBC [2016] FCA 149. 3 The Aboriginal Corporation effectively came into existence to perform the functions of a prescribed body corporate (PBC) nominated under the Native Title Act 1993 (Cth) (NTA) to hold and manage native title determined to exist and held by the Eastern Guruma people. 4 The Aboriginal Corporation has held and managed the native title since two consent determinations of native title were made respectively in 2007 and 2012. 5 The Stevens and Mr Camille and Mr Smith are Eastern Guruma people and members of the Aboriginal Corporation. At material times, Mr Camille and Mr Smith were, as they remain, two of a number of directors of the Aboriginal Corporation. 6 It appears that from about 2006 to around 2012, matters to do with native title arising under the NTA, including heritage survey operations on Eastern Guruma land, were dealt with directly by the Aboriginal Corporation. 7 The Eastern Guruma Charitable Trust No 2, usually referred to as the Plan B Trust, was set up to advantage Eastern Guruma people in this regard and was administered by Australian Executor Trustees Ltd. Payments from dealings with third parties concerning such matters went into the Plan B bank account. 8 In late 2012, however, a recommendation was made to the board of the Aboriginal Corporation to set up a separate commercial arm of the Aboriginal Corporation to allow for enterprises, such as joint ventures, to be undertaken for the benefit of Eastern Guruma people, and to bring heritage survey operations as well as administrative operations (including payments to staff, directors and rent) within one new entity controlled by the Aboriginal Corporation. 9 The stated purpose of this recommendation was to shield the Aboriginal Corporation, as the holder and manager of native title, from any adverse commercial results arising from such enterprises. 10 In the event, it appears two entities were initially established, not one: Eastern Guruma Administration Pty Ltd and Eastern Guruma Administration Services Pty Ltd. Rather than being set up as subsidiaries of the Aboriginal Corporation, Mr Camille and Mr Smith were both directors and shareholders of Administration and Mr Camille was one of three directors and shareholders of Services. 11 At the time of the hearing of this matter, Services had been deregistered. 12 Subsequently, two further entities were formed: Wintawari Guruma Enterprises Pty Ltd and Muntulgura Guruma JV Pty Ltd. 13 As to Enterprises, the Aboriginal Corporation is the sole shareholder and Mr Camille and Mr Smith are directors. 14 In relation to JV, Enterprises is one of two independent shareholders, each of whom hold a 50% interest in the equity and Mr Camille is one of four directors. In short, the Aboriginal Corporation, through Enterprises, holds a 50% interest in JV. 15 The Plan B Trust, referred to above, was established on 26 July 2000. 16 A further trust, simply described as the Eastern Guruma Charitable Trust, was established on 19 June 2012, and is often referred to as the Pascoe Trust. 17 As explained in the recent judgment referred to above, on 6 January 2015, the Stevens commenced this proceeding, WAD 1 of 2015, alleging that Mr Camille and Mr Smith had breached their duties as directors of the Aboriginal Corporation by establishing the aforementioned corporations - Administration, Services, Enterprises and JV. When they commenced these proceedings they sought a number of remedies designed to prevent Mr Camille and Mr Smith from acting as directors of the Aboriginal Corporation and from managing each of these entities, as well as seeking an account of profits. Later, they filed an interlocutory application dated 20 April 2015 in which they sought leave to continue the proceedings in the name of the Aboriginal Corporation. 18 On the hearing of the application for leave, submissions were made having regard to what was set out in an amended statement of claim that the Stevens proposed should be filed if leave were granted. 19 Counsel for the Stevens narrowed down the basis upon which leave was sought, by reference to this proposed amended statement of claim, to what he called the "traditional decision-making process allegations". 20 The traditional decision-making process allegations are to be found at [4] to [8] of the proposed amended statement of claim, in the following terms: 4. Pursuant to the determinations of this Honourable Court in Hughes on behalf of the Eastern Guruma People v State of Western Australia [2007] FCA 365 ['Hughes'] and Hughes on behalf of the Eastern Guruma People (No 2) v State of Western Australia [2012] FCA 1267 (20 November 2012) ['Hughes No 2'1 which are hereafter collectively called the 'Native Title Determinations', the Eastern Guruma People are the holders of Native Title in and over the lands described in the Native Title Determinations. 5. The laws and customs of the Eastern Guruma People require certain traditional decision making processes ['the Traditional Decision Making Processes'] to be followed in making decisions which have, or may have, a material effect on the Eastern Guruma People or a substantial number of the Eastern Guruma People. 6. The Traditional Decision Making Processes are required to be followed in making decisions about, amongst other things, the exercise of rights in, over and in respect of land the subject of the Native Title Determinations. 7. The Eastern Guruma People comprise persons who are members of, and identify themselves as members of one or other of the following four families: (i) the Hicks family; (ii) the Stevens family; (iii) the Hughes family; and (iv) the Smith-Connors family. ['the Four Families']. 8. Pursuant to the Traditional Decision Making Processes the Eastern Guruma People have determined that each of the Four Families: (a) is to be equally represented on any corporations, boards, committees and decision making bodies which are established or are to be established to exercise the rights of the Eastern Guruma People including their rights in or over land the subject of the Native Title Determinations or are otherwise recognised by or derived from the Native Title Determinations ['the Eastern Guruma Corporate Entities']; (b) is to abide by the constitutions, rules, process, and mechanisms of the Eastern Guruma Corporate Entities to the extent that it is lawfully required to do so, (c) is to be involved in the decision making processes and governance of the Eastern Guruma Corporate Entities; (d) is to share equally in the benefits and opportunities created by or which result from the activities and enterprises conducted or carried on by any of the Eastern Guruma Corporate Entities. 21 Then, relevantly, in respect of Administration, the following allegations are made: 16. Eastern Guruma Administration Pty Ltd is: (a) a company incorporated on or about 27 February 2013 pursuant to the Corporations Act 2001 (Cth); (b) an Eastern Guruma Corporate Entity, is subject to the Traditional Decision Making Processes and is bound to recognise and give effect to the rights and obligations of each of the Four Families which are described in paragraph 8 above; and (c) its directors include the first and second respondents; and (d) each of the first and second respondents hold one of the three issued shares in Eastern Guruma Administration Pty Ltd. 17. Wrongfully and in breach of the duties referred to in paragraph 15 of the [amended statement of claim], the first and second respondents have: (a) procured the incorporation of Eastern Guruma Administration Pty Ltd: (i) without the knowledge or consent of WGAC or of the applicants; and (ii) without proper representation of each of the Four Families as required under the Traditional Decision Making Processes. (b) caused the Eastern Guruma Trust to pay moneys to Eastern Guruma Administration Pty Ltd without the knowledge or consent of WGAC, the applicants or the Eastern Guruma People Particulars 1 May 2014 the Eastern Guruma Charitable Trust paid $10,000 to Eastern Guruma Administration Pty Ltd and a further $40,927 was paid on 26 May 2014. On 25 May 2014 API Management Pty Ltd, a mining company, paid the sum of $40,927.00 into the Eastern Guruma Charitable Trust. (c) used the moneys referred to in paragraph 17(b) above for their personal benefit or the benefit of their associates or otherwise without the knowledge or consent of WGAC the applicants or the Eastern Guruma People. 22 Similar pleas are made in respect of Services (at [18] and [19]), Enterprises (at [20] and [21]) and JV (at [22] and [23]). 23 The allegations at 17(b), 19(b), 21(b) and 23(b) are those that counsel for the Stevens focuses on. He says the para (b) allegation in each case is the corollary of the para (a) allegation. That is, that the relevant entity was incorporated in breach of the traditional decision-making processes and also in breach of the statutory duties of the directors. 24 Counsel for the Stevens explains that they are the allegations that spring most directly from the traditional decision-making process allegations. He puts it on the basis that part of the corporate governance requirements of the Aboriginal Corporation, as established by conduct, which will be proven at trial by compendious evidence, are the traditional decision-making processes, and that the directors acted in disregard of those processes and, in doing so, acted other than for a proper purpose or other than in good faith - the duties pleaded against the respondents at [15] of the proposed amended statement of claim. 25 So far as the traditional decision-making process allegations are concerned, this is the precise case that the Stevens wish to put if leave is granted to maintain or bring the proceedings in the name of the Aboriginal Corporation against the respondents. 26 There is, however, a second issue that the Stevens also wish to have leave to pursue in the name of the Aboriginal Corporation against Mr Camille, set out at [24]-[26] of the proposed amended statement of claim, which concerns his role as chairperson of the Aboriginal Corporation. 27 Paragraphs [24] to [26] allege as follows: 24. The first respondent has since about March 2013 been employed by WGAC on a full time basis in the role of the Manager of WGAC pursuant to a written agreement executed by the first respondent and dated 25 March 2013. The said agreement sets out certain duties and responsibilities of the first respondent as Manager of WGAC including his being required to: (a) Manage the assets of WGAC; (b) Manage Native Title matters under the NTA; (c) Manage Heritage matters under the Aboriginal Heritage Act 1972-80; (d) Manage the office of WGAC and oversee WGAC staff; (e) Ensure appropriate accounting and audit systems in place in conjunction with service providers; (f) Oversee agreements which are entered into between the entities and third parties; (g) Appoint and liaise with consultants; (h) Ensure compliance with ORIC rules and regulations; (i) Provide regular reports to the Board of WGAC; (j) Receive reports and where appropriate, attend meetings of subsidiary and/or related entities of WGAC, including Joint Venture partners and other companies with which WGAC has interests arising from agreements; (k) Other duties as required from time to time by the Board of WGAC. 25. The Constitution of WGAC states, at clause 5.3 that the chief executive officer [of WGAC] may be a director but cannot chair the director's meetings. The applicants say that the role of the first respondent is, by reason of both the matters referred to in paragraph 24 above and the manner in which the first respondent has conducted himself as an employee of WGAC, equivalent to that of a chief executive officer of WGAC. Particulars Full particulars will be supplied prior to trial 26. In breach of the obligation set out in clause 5.3 above the first respondent has, since March 2013 continued to: (a) hold the office of and to represent himself as the Chairperson of WGAC; and (b) chair directors meetings and other meetings of WGAC, while at all material times continuing to perform the role of the chief executive officer of WGAC. 28 It should also be noticed that the relief claimed in the proposed amended statement of claim is as follows: (1) The "first applicant" claims a declaration that the respondents have breached their directors duties by establishing each of the four related entities; injunctions; accounts and enquiries, including accountable profits as a result of the breaches; and consequential relief. (2) The "second applicant" claims a declaration that Mr Camille has breached the obligation referred to in [26] of the proposed amended statement of claim not to chair meetings of the Aboriginal Corporation or otherwise occupy the role of a chairperson; injunctions; and consequential relief. 29 For present purposes, however, I proceed on the basis that the Stevens together seek relief in those terms. 30 There are then two main issues raised on the Stevens' leave application: (1) Whether leave should be granted to the Stevens to maintain a proceeding, in the name of the Aboriginal Corporation, against both respondents for a declaration, and consequential relief, that they have breached the duties referred to in [15] of the proposed amended statement of claim. (2) Whether leave should be granted to the Stevens to maintain an action, in the name of the Aboriginal Corporation, against Mr Camille for a declaration that he has breached the obligation referred to in [26] of the proposed amended statement of claim, and consequential relief.
Should the Court grant leave to the Stevens to bring or continue proceedings on behalf of the Aboriginal Corporation against the respondents for alleged breach of directors' duties? 31 Sections 169-1 and 169-5 of the CATSI Act are relevant to this question. These provisions reflect similar provisions to be found in the Corporations Act 2001 (Cth) that enable a person with an appropriate interest to obtain leave to intervene in proceedings on behalf of a corporation. These provisions are sometimes referred to as provisions enabling a "derivative action". 32 By s 169-1(1), a person who, amongst other things, is a member or former member of an Aboriginal and Torres Strait Islander corporation and acting with leave granted under s 169-5, may bring proceedings on behalf of such a corporation or intervene in any proceedings in which such a corporation is a party. Where proceedings are brought on behalf of a corporation, they must be brought in the corporation's name. 33 The relevant question in the circumstances of this case, where the Stevens were, at material times, members of or persons entitled to be registered as members of the Aboriginal Corporation, is whether they have, or should have, leave under s 169-5 of the CATSI Act. 34 Section 169-5 provides as follows: Applying for and granting leave Who may apply for leave? (1) A person referred to in paragraph 169-1(1)(a) may apply to the Court for leave to bring, or to intervene in, proceedings. Court to grant the application in certain circumstances (2) The Court must grant the application if it is satisfied that: (a) it is probable that the corporation will not itself bring the proceedings, or properly take responsibility for them, or for the steps in them; and (b) the applicant is acting in good faith; and (c) it is in the best interests of the corporation that the applicant be granted leave; and (d) if the applicant is applying for leave to bring proceedings - there is a serious question to be tried; and (e) either: (i) at least 14 days before making the application, the applicant gave written notice to the corporation of the intention to apply for leave and of the reasons for applying; or (ii) it is appropriate to grant leave even though subparagraph (i) is not satisfied. This subsection has effect subject to subsections (3) and (5). When leave is not in the best interests of the corporation (3) A rebuttable presumption that granting leave is not in the best interests of the corporation arises if it is established that: (a) the proceedings are: (i) by the corporation against a person who is not a related party of the corporation; or (ii) by such a person against the corporation; (including any appeal from a decision made in proceedings by or against the corporation); and (b) the corporation has decided: (i) not to bring the proceedings; or (ii) not to defend the proceedings; or (iii) to discontinue, settle or compromise the proceedings; and (c) all of the directors who participated in that decision: (i) acted in good faith for a proper purpose; and (ii) did not have a material personal interest in the decision; and (iii) informed themselves about the subject matter of the decision to the extent they reasonably believed to be appropriate; and (iv) rationally believed that the decision was in the best interests of the corporation. Note: Related party is defined in section 293-1. (4) A director's belief that the decision was in the best interests of the corporation is a rational one unless the belief is one that no reasonable person in his or her position would hold. Decision taken to give effect to Native Title legislation obligation (5) The Court must not grant the application if: (a) the corporation has decided: (i) not to bring the proceedings; or (ii) not to defend the proceedings; or (iii) to discontinue, settle or compromise the proceedings; and (b) an officer or employee of the corporation made that decision: (i) in good faith; and (ii) with the belief that making the decision was necessary to ensure that the corporation complies with a Native Title legislation obligation. 35 The parties agree that the questions in this case, as to whether leave should be granted to the Stevens, relate to whether they can satisfy subs (2)(a)-(e).
Para (a) 36 It is not in issue that para (a) is satisfied, in that it is not probable that the Aboriginal Corporation will itself bring proceedings against the respondents, if leave is refused. 37 Thus the questions are, in essence, whether the Stevens are demonstrated to be acting in good faith; whether it is in the best interests of the Aboriginal Corporation that they be granted leave; and whether there is a serious question to be tried.
Para (b) - a question of good faith 38 The Stevens contend they are acting in good faith and that there is no suggestion that they are not doing so. They say they have assumed considerable personal financial burden and risk by agitating their complaints. They point to Mr Wayne Stevens' affidavit sworn 28 January 2015, where he swears to a belief that they have a good cause of action. They say the proceedings are not brought for the private interests of the Stevens; rather the relief they seek is on behalf of the Aboriginal Corporation or the Eastern Guruma People as a whole. They say there is no suggestion that any of them have been complicit in any of the wrongful conduct they have alleged. 39 The respondents say the questions whether an applicant honestly believes a good cause of action exists and it has a reasonable prospect of success, and whether the proposed bringing of a derivative action is attended by a collateral purpose that would amount to an abuse of process, may be regarded. However, they say the enquiry concerning an applicant's good faith is not limited to these two matters. They refer to Coeur De Lion Investments Pty Ltd v Kelly [2014] 1 Qd R 296 at [48] and [74]; [2013] QCA 160. They say it is for the applicant applying for leave to satisfy the Court they are acting in good faith and not for the respondents to establish bad faith on their part. 40 The respondents say the bold assertion that the Stevens are acting in good faith is not sufficient and that the Court may draw inferences as to their good faith by assessing the nature of the allegations and the circumstances out of which they arise. They contend that objective facts and circumstances will often speak louder than assertions of good faith. They refer to Vinciguerra v MG Corrosion Consultants Pty Ltd (ACN 084 715 177) (2010) 79 ACSR 293 at [56]; [2010] FCA 763. 41 In this case, the respondents query how it could be said that these proceedings are in good faith given the marked absence of an evidentiary basis for a number of allegations made by the Stevens, including that described as the "central issue". They further query the Stevens' good faith on the bases that no explanation is provided as to why the proceedings are only brought against the respondents rather than other directors and shareholders of Administration and Services; the apparent inutility of the relief sought; the failure to make any genuine steps to resolve the dispute prior to making the application; and, although not ultimately pursued, the making of serious allegations of dishonesty without any apparent substance. 42 At the hearing, counsel for the respondents and the Aboriginal Corporation both queried how the Stevens could be said to be acting in good faith when the "central issue" mirrors the matters that the Stevens say will be agitated in WAD 374 of 2015, regardless of the outcome of this application. Counsel contended that, in those circumstances, the effect of granting the Stevens leave to continue the proceedings on behalf of the Aboriginal Corporation would be, in substance, to call upon the Aboriginal Corporation to sue itself. 43 In my view, in the particular circumstances of this case, it is unnecessary to explore the limits of the concept of good faith in this statutory and factual context, because I have a clear view that there is no serious question to be tried. 44 In broad terms, however, I do not consider that the Stevens have failed to demonstrate good faith in bringing the application for leave. I accept that they, particularly Mr Wayne Stevens having regard to his affidavit, bear a grievance that traditional decision-making processes have not been employed in the decision-making of the board of the Aboriginal Corporation and the four related entities when they should have been, and that they personally believe there is a good cause of action. While it is not difficult to see how the respondents consider that by the application for leave, and the initial filing of proceedings WAD 1 of 2015, The Stevens intended to cause the respondents and the Aboriginal Corporation serious disruption in having to respond to the serious allegations of breach of duty made, and to defend the proceedings and in the process incur costs, I consider on balance good faith has been demonstrated.
Para (c) - best interests of the Aboriginal Corporation 45 The Stevens contend that "investigating these allegations is worth the cost to the company". 46 They say the central allegation is that the Aboriginal Corporation and its associates and subsidiaries are to be managed in accordance with traditional decision-making processes - that is, in a way that ensures the involvement of members of each of the four families. 47 They say that allegation goes to the "very heart" of the rationale for and operation of the Aboriginal Corporation and say it is necessarily in its best interests that that issue be judicially resolved. 48 The respondents contend that, in order to satisfy para (c), it is necessary for the Stevens to show that the proposed derivative action is in the best interests of the Aboriginal Corporation, a higher standard, and it is not sufficient to establish that it may be in the Aboriginal Corporation's best interests. 49 The authorities support this principle. In Vinciguerra, at [111], Gilmour J said as follows: Section 237(2)(c) requires the court to be satisfied that the proposed a derivative action is in the best interests of the company: Swansson at [56]. The Court in Chahwan observed that the wording sets a high standard. It is not sufficient to establish that it may be in the company's best interests. 50 The respondents say that whether the requirement is satisfied by the Stevens can only be determined by taking into account all the relevant circumstances, including the character of the Aboriginal Corporation. They say the Court can consider whether: (1) the proposed proceedings will cause distractions to the board and/or disruption to the Aboriginal Corporation's business; (2) the proceedings could be brought in the name of the Stevens alone; and (3) the proceedings are of any practical benefit to the Aboriginal Corporation. 51 Counsel for the Aboriginal Corporation says it could not be in the Aboriginal Corporation's best interests in circumstances where its directors and members twice resolved not to pursue the proceedings, and the Stevens are able to pursue the "central issue" in WAD 374 of 2015. 52 The respondents say it could not positively be in the best interests of the Aboriginal Corporation if the proposed proceedings ultimately recover little or nothing from the respondents and it must be demonstrated that there will be benefit to the Aboriginal Corporation if WAD 1 of 2015 is successful. In this regard, they refer to authority including Re The President's Club Limited; Coeur De Lion Investments Pty Limited v Kelly & Ors [2012] QSC 364 at [61]; and Suh & Ors v Cho & Ors [2013] VSC 491 at [41]. 53 The respondents say in assessing this question the Court can also take into account the possibility of the respondents successfully relying on s 576-1 of the CATSI Act and s 1318 of the Corporations Act 2001 (Cth), to relieve them wholly or partly from any liability for which they would otherwise be subject. 54 The respondents submit that for the Court to be satisfied that it is in the best interests of the Aboriginal Corporation to continue WAD 1, the Court should be satisfied that the Aboriginal Corporation's financial interests are properly protected and say: (1) the absence of evidence that the Stevens would indemnify the Aboriginal Corporation for all costs if leave were to be granted is a factor against the grant of leave being in its best interests; and (2) the absence of evidence that the Stevens' financial positions are sufficient to meet, by way of indemnity, any adverse costs order if leave were to be granted, is also relevant. 55 The Stevens say questions of evidence in this regard are neither here nor there; if the Court considered it appropriate, it could simply condition its order upon the provision of an indemnity. Further, the Stevens say, the Aboriginal Corporation should not be a respondent to the proceedings and ought to have abided the outcome of the dispute. In those circumstances, the Stevens say the Aboriginal Corporation should not have its costs and should meet the Stevens' costs for the duplication of effort required. In this regard, counsel for the Aboriginal Corporation points to the fact that it was involved in the proceedings by programming orders made by Siopis J; an explanation the Stevens contest. 56 In my view, there are serious questions whether the maintenance of WAD 1 of 2015 would be in the best interests of the Aboriginal Corporation for the reasons advanced by the respondents. Not the least of these is the question of costs that would be incurred and the extent to which it is likely any of the Stevens are in any position, on the evidence they have adduced, to indemnify the Aboriginal Corporation for those costs in the event the proceedings are not successful. 57 But really, as I have said in relation to the good faith issue above, this case is critically to be decided by reference to the question whether or not there is a serious question to be tried. I now turn to that issue. I do consider, however, that the Stevens apparent inability to indemnify the Aboriginal Corporation's costs is a relevant factor supporting the Court's refusal to grant leave in the particular circumstances of this case.
Para (d) - serious question to be tried 58 The authorities establish, as the respondents acknowledge, that the threshold is a relatively low one, analogous to that which must be met in order to obtain the grant of an interlocutory injunction. See Swansson v RA Pratt Properties Pty Ltd and Another (2002) 42 ACSR 313 at [25]; [2002] NSWSC 583; Gaertner v Dharah Gibinj Aboriginal Medical Service Aboriginal Corporation [2013] FCA 1330 at [46]. 59 Nonetheless, it is clear that the application for leave must be supported by evidence and that a mere indication of evidence without actual evidence is insufficient, as discussed, for example, in Vinciguerra at [140] and [141]. The evidence must make out a "prima facie case", so to speak, in the sense that the Stevens must show a sufficient likelihood of success. 60 The Stevens say the circumstances of their allegations include the failure of the respondents, and the Aboriginal Corporation by reason of the actions of the respondents, "to disclose and explain the affairs of" the Aboriginal Corporation and the four related entities. 61 As to the four entities, the Stevens contend there is a serious question to be tried in the premises of: (1) the traditional decision-making process allegations and the consequences that would follow if those allegations were made out at trial; (2) records of the Australian Securities and Investments Commission for the four companies, showing who are the shareholders and directors; (3) bank records showing the alleged payments from the Pascoe Trust to Administration; (4) invoices issued by Services including a 15% "administration" fee; and (5) the lack of explanation, whether in financial disclosures, AGMs, correspondence or otherwise, despite repeated requests. 62 The manner in which the Stevens seek to identify the serious question to be tried, however, leaves much to be desired. In determining whether there is a serious question to be tried, regard must be had to the way in which they would plead, according to the proposed amended statement of claim. 63 At [5] of the proposed amended statement of claim, they allege that the laws and customs of the Eastern Guruma People "require certain traditional decision-making processes" to be followed in making decisions which have, or may have, a material effect on the Eastern Guruma People or a substantial number of them. 64 At [6], they allege that the traditional decision-making processes are required to be followed in making decisions about, amongst other things, the exercise of rights in, over and in respect of land the subject of the two native title determinations. 65 They say the four families referred to above are those who comprise the Eastern Guruma People. 66 Then, at [8], they allege that "[p]ursuant to the Traditional Decision Making Processes the Eastern Guruma People have determined" (emphasis added) that each of the four families should be equally represented on corporations etc. that are established or are to be established to exercise the rights of the Eastern Guruma People and the other matters pleaded in paras (b), (c) and (d) of [8] set out above. 67 There is a dearth of evidence to support the allegation that the Eastern Guruma People "have determined", pursuant to the traditional decision-making processes alleged, that each of the four families is to be equally represented in the manner described. 68 Furthermore, the evidence to support the allegation that "[p]ursuant to the Traditional Decision Making Processes the Eastern Guruma People have determined" that each of the four families is to be equally represented, is relatively circular. To make out that allegation it would be necessary first to establish that the traditional decision-making processes are as they have been pleaded. But they are not pleaded with any particularity, only that the laws and customs of the Eastern Guruma People "require certain traditional decision-making processes to be followed". 69 The evidence before the Court concerning the traditional decision-making processes of the Eastern Guruma People is extremely general, to say the least. It is not evidence that actually supports the traditional decision-making process allegations made or, in particular, the allegation that there is to be found some determination that each of the four families has to be equally represented on corporations and other bodies, or in the decision-making of the Eastern Guruma People. 70 The most that can be said of the relevant processes is to be found at [4] of the affidavit of Mrs Judith Hughes, made for the purpose of the initial consent determination in March 1999, where Mrs Hughes states that: Following the meeting with the NNTT [National Native Title Tribunal] the Eastern Guruma People held a meeting and made a decision to lodge the claim to protect their country. This decision was made in accordance with traditional laws, customs and processes where the Elders make the final decision. At this meeting our elders were nominated as the claimant applicants for the proposed Native Title Claim namely: P …Stevens [now deceased], Nelson Hughes and Eva Connors. This is not an observation or statement that means anything more than it says, namely, that elders make a final decision. The fact that the elders nominated at that time included persons with the last names Stevens, Hughes and Connors, falls a long way short of proving the traditional decision-making process allegations. 71 Indeed, other portions of Mrs Hughes' affidavit apparently contradict the decision-making processes asserted by the Stevens. At [8] to [10] of her affidavit, Mrs Hughes states that: When the Gurama people have meetings we contact everyone who needs to be at the meeting by fax, phone, and we visit the elders and talk to them about the meeting and explain what the meeting is for and to make sure that everyone who should be there attends. Aboriginal people's decision making is done orally; we meet and discuss things between one another, within our immediate family and extended family, between the different family groups and the wider language group. Certain things may need to be discussed by the men, the elders, or the women at these meetings. These meetings takes place in the home, at gatherings, while we are hunting or fishing, when we visit relatives, or at funerals or law and culture meetings. 72 Perhaps more to the present point, that evidence, and the evidence contained in an anthropological report of Dr McDonald to which counsel for the Stevens referred at the hearing, does not provide any evidentiary basis, and certainly not at a sufficient level, for the Court to conclude that there is a serious question to be tried so far as the traditional decision-making process allegations are concerned. 73 In these circumstances, it is unnecessary to consider the respondents' and Aboriginal Corporation's further submission, that even if there was sufficient evidence, how it can be said that a failure to comply with decision-making processes would amount to the Aboriginal Corporation acting improperly or beyond its powers or constitute a breach of the respondents' duty to the Aboriginal Corporation. In this regard, the Aboriginal Corporation points to the fact that it acted within the powers in its constitution and distinguishes decisions affecting native title rights and interests from those that do not, on the basis that only the former must be made according to traditional decision-making processes.
Para (e) 74 It is not disputed that the Stevens gave written notice to the Aboriginal Corporation of their intention to apply for leave and of the reasons for applying on 13 March 2015. Thus it is not in issue that para (e) is satisfied.
Consideration 75 In these circumstances, the Court would refuse leave to the Stevens to bring or continue the proceedings on behalf of the Aboriginal Corporation against the respondents for alleged breach of directors' duties.
Should the Court grant leave to the Stevens to bring proceedings on behalf of the Aboriginal Corporation against Mr Camille for alleged breach of the obligation pleaded in [26] of the proposed statement of claim? 76 The second issue that the Stevens seek leave to pursue in the name of the Aboriginal Corporation in substance concerns whether Mr Camille breached the Aboriginal Corporation's rule book by simultaneously acting as its chairperson and CEO. 77 This issue is, once again, to be critically decided by reference to whether there is a serious question to be tried. 78 In this regard, the Stevens contend there is a serious question to be tried in the premises of: (1) the Aboriginal Corporation's records showing that Mr Camille chaired meetings; and (2) Mr Camille's employment contract as "manager" and the duties set out therein. 79 By reference to s 246-5 of the CATSI Act and R 5.3 of the Aboriginal Corporation's rule book at the time, they say that both required the CEO not to chair directors' meetings. 80 Subsection 246-5(5) of the CATSI Act relevantly provides that: If a person is performing a chief executive officer function in relation to the corporation, the person may be a director of the corporation but cannot chair the directors' meetings. 81 At material times, R 5.3 of the rule book to similar effect provided that: The chief executive officer may be a director but cannot chair the directors' meetings. 82 The Stevens say that Mr Camille's contractual duties as "manager" fell within the definition of "chief executive officer function" in s 694-85 of the CATSI Act. 83 They also say that, at the trial of WAD 374 of 2015, Mr Walker, a witness for the Aboriginal Corporation, said the following: MR COSTELLO: Glen runs WGAC? - - -No. Us directors do. The directors do. And in terms of the employees, Glen is the one that is the - - - ?---He is the - - - - - - main man?---Yes. Yes. But he reports to the board of directors?---Yes. But he's on the board as well?---Yes. Yes?---He is our CEO. He is your CEO. Good. Wayne and Glen have had disagreements over time; you know about that?---I know about that. Yes. 84 At the hearing of the interlocutory application for leave, counsel for the Stevens said the argument is a confined one that turns on the proper construction of Mr Camille's then employment contract; the Aboriginal Corporation's rule book; and the terms of the CATSI Act. 85 The respondents say the allegation has nothing to do with the interlocutory application for leave in circumstances where the allegation is only made by Ms Tania Stevens. Consequently, they say whether or not there is a serious question to be tried in this regard has nothing to do with the issues raised by the interlocutory application. 86 The Aboriginal Corporation notes that no particulars of the allegation in [25] of the proposed amended statement of claim are given. It denies that Mr Camille was employed as CEO at the time alleged but, nevertheless, to avoid any disputation, Mr Camille, although continuing to be a director, ceased chairing directors meetings from 12 January 2015. Consequently, it says the allegation in [25] is otiose. 87 The Aboriginal Corporation further says that the allegation in [26] of the proposed amended statement of claim is plainly misconceived. It says there is no provision in its rule book preventing Mr Camille being elected to and holding the position of chairperson of the Aboriginal Corporation; that R 5.3, on which the Stevens rely, contains no such prohibition. 88 In the Court's view there is no serious question to be tried. I accept that, whatever the true situation is concerning whether Mr Camille was the CEO of the Aboriginal Corporation at material times or held some other employed position, since 12 January 2015, he has ceased chairing directors' meetings. In those circumstances, if it could be established that there had been some earlier contravention of the CATSI Act or the rule book, the consequences are not at all clear. The only relief that the Stevens seek, or Ms Tania Stevens seeks, is a declaration that the obligation was breached. 89 There is, however, no prohibition on Mr Camille being both a CEO, if that were to be the case, as well as a director of the Aboriginal Corporation. The only embargo is on him chairing directors' meetings if he is in fact the CEO. 90 In these circumstances, as the Aboriginal Corporation submits, the allegations made are otiose and the theoretical grant of any relief in historical terms would be of no utility and so unlikely to be granted. 91 In those circumstances, there is no serious question to be tried. 92 Accordingly, the Court would refuse leave to the Stevens to bring or continue the proceedings on behalf of the Aboriginal Corporation against Mr Camille for the alleged breach of the obligation pleaded in [26] of the proposed amended statement of claim.
Conclusion and orders 93 For these reasons, the Stevens' application for leave to continue this proceeding as a derivative action in the name of the Aboriginal Corporation is refused. I will hear from the parties as to the appropriate orders. I certify that the preceding ninety-three (93) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Barker.
Stevens
Camille
[2013] QCA 160
[2012] QSC 364
[2013] VSC 491